Thousands free to reopen claims for compensation from banks?

The High Court could be tearing up thousands of legal settlements between customers and their banks over the misselling of interest rate swaps scandal, thanks to a legal spat between the Lloyds Banking Group and the owner of a property company, Gary Hartland.

The Libor-fixing case brought by Hartland's Wingate Associates could allow individuals to revisit settlement agreements. Lloyds are obviously very unhappy about this, as it has already cost them billions already.

So what's the craic? Wingate Associates are claiming that the settlement they received in 2011 over misselling should be overturned, thanks to the bank’s involvement in fixing Libor. Lloyds argue that the settlement should hold, because they're presumably bored of dealing with all this.

Thus far, over 12,000 settlement agreements relating to interest rates have been sorted out under the Financial Conduct Authority redress scheme, which has a value somewhere in the region of £2bn. You can imagine that, should even a small fraction of these claimants reopen their cases, it could be very costly indeed.

Stephen Rosen, the head of financial disputes at law firm Collyer Bristow, told the Indy: "The value of claims out there is still very substantial. When you add Libor-fixing to a claim it can swell its value very quickly and matters such as consequential loss are brought into play."

What's more, Hartland has sued before over Libor-fixing. Previously, he made a claim against Barclays through another company he ran (called Guardian Care Homes), which was settled out of court by the bank for £40m.

A spokesman for Lloyds said: "As the matter is now subject to legal proceedings, it would be inappropriate to comment in any detail. However, having previously agreed a full and final settlement with the customer in 2011, we do not believe the matter has any merit and it will be vigorously contested."